Latest news with #carfirm
The Sun
4 days ago
- Automotive
- The Sun
Major car firm ‘discontinuing cheapest model & halting pay rises' – weeks after axing 20,000 jobs and £4bn losses
A MAJOR car firm is reportedly discontinuing its cheapest model and halting pay rises just weeks after announcing £4billion in losses. The struggling car maker had announced plans to axe over 20,000 members of staff due to soaring production costs and disappointing sales. 2 2 Cash-strapped Nissan, Japan's third-largest carmaker, is already facing billions in losses - its worst annual loss in a quarter century. Nissan is looking to raise £5.2billion to stay afloat, with UK Export Finance underwriting a £1billion loan - which will support the beleaguered company. Now, the company has started offering buyouts to US workers and has suspended merit-based wage increases worldwide, reports Reuters. As part of the cuts, Nissan has offered separation packages to workers at its Canton plant in Mississippi. Salaried workers in human resources, planning, information technology and finance have also been offered similar packages. Merit-based pay increases have also been suspended worldwide by Nissan for the current business year, in a separate email seen by Reuters. Christian Meunier, Nissan America's chairman, said the buyouts are 'crucial for Nissan's comeback' in the US, its most important market. 'While substantial efforts have been made in the US to help right-size Nissan, we need to take additional, limited, strategic action here at a local level,' Meunier said in an email. And Nissan has also discontinued its cheapest model, the manual-equipped Versa, according to reports. The Japanese automaker halted making the Versa with the five-speed manual at its Aguascalientes, Mexico, factory, according to Automotive News. The publication stated that a "person with knowledge of the matter" revealed that the most affordable new car on the market would see "production cease". It is understood that the rest of the Versa lineup will continue as usual but this is yet another huge blow to the carmaker. It comes after reports the manufacturer is planning to cut its number of factories from 17 down to 10. This has prompted fears that the brand's Sunderland factory could be under threat. While Nissan has not confirmed the fate of its only UK factory, its CEO Ivan Espinosa has insisted that more electric cars will be produced there. It is hoped that the £1billion loan from Nissan's lenders, underwritten by The Government, will protect the site. The huge cash injection is just a fifth of the 1Trillion Yen needed by the company to survive. It will also look to issue as much as 630billion yen in convertible securities and bonds, including high-yield and euro notes. Reportedly, the firm is looking to sell-and-lease-back its Yokohama headquarters alongside several properties in the United States. Finally, the struggling car manufacturer is eyeing a sale of its stakes in Renault and battery maker AESC Group. The aggressive fundraising plans underscore Nissan's rapidly deteriorating financial and operational position, despite efforts by newly appointed chief executive Ivan Espinosa to turn the company around. Development on other Nissan models has been paused, whilst the company tries to balance its books. Work on all 'advanced and post-FY26 product activities' has been paused, though Nissan has not confirmed which particular vehicles will face suspension.
The Sun
27-05-2025
- Automotive
- The Sun
Major car firm ‘may sell £500m headquarters to survive' – weeks after axing 20,000 staff and £4bn losses
A MAJOR car firm may sell their £500m global headquarters to cut costs in its fight for survival. This comes after a huge wave of cuts was announced worth a staggering £1.3 billion in addition to axing tens-of-thousands of jobs. 3 3 Cash-strapped Nissan, Japan's third-largest carmaker, may part ways with its global headquarters in Yokohama, Japan, to fund the company's urgent restructuring plan. After having moved to the 22-story high-rise in 2009, the car manufacturer is now facing mountains of debt and is on track to cut 20,000 jobs, shut several of its plants and slash billions in costs. With a glitzy gallery, the flashy headquarters can showcase more than thirty motors and stands in stark contrast to their previous offices. The company have said that part of their plan has called for reviewing assets that can be sold in a desperate bid to pay for the restructuring. With its own headquarters in sight, thought to be worth approximately £500 million, Nissan would structure a deal so it could continue to use the site through a lease so its offices and operations remain in place. A company spokesperson said: "Nissan is considering all possibilities to recover its business performance, but there are no specifics to share at this point of time." The move is not unprecedented, however, with McLaren doing something similar with its HQ in Woking in recent years. , its worst annual loss in a quarter century. This has resulted in drastic measures being implemented under the 'Re:Nissan' plan The company hopes to have completed an initial £1.3 billion cost-cutting mission by 2026 with remaining losses plugged by a huge wave of closures in a bid to become profitable again. This will see a reduction in the company's workforce of 20,000 employees by 2027. Areas including sales, research, administration, development and manufacturing are all expected to be hit hard by the cuts. As of March 2024, the company had more than 133,000 staff worldwide - meaning a total 15% of its entire workforce is set to be hit. Nissan is also planning to close seven factories by 2027, including two domestic sites which are thought to be the Oppama and Shonan plants, saving £2.6 billion in the process. There have also been reports of downsizing or a partial sale of its Tochigi assembly plan and test centre facility north of Tokyo which was recently equipped with manufacturing technologies to assemble electric vehicles. To underline the dire financial situation, the motor company is even halting the development of certain models to cut its expenses. While the car company has been hit hard by the effects of Donald Trump's tariff war, Nissan's new CEO, Ivan Espinosa, has admitted the company's financial trouble started a decade ago. He said: "Let me start by explaining why we are here. "This is not something that happened in the last couple of years. "It's more of a fundamental problem that probably started back in 2015, when management thought this company could reach [annual global vehicle sales] of around eight million. "There were heavy investments both in terms of planned capacity as well as in human resources, but the reality today is we are running at around half that volume. And nobody did anything to fix that until now.' He aims to strengthen ties with fellow auto manufacturers Renault, Mitsubishi and Chinese ally Dongfeng, following a failed merger with Honda in February. It's also possible he allows Dongeng to build cars as Nissan's UK factory in Sunderland which, as it stands, does not currently face the threat of closure. But despite the financial turmoil, Nissan is slated to bring more than ten new models to North American roads soon. They also plan to introduce the next generation of Nissan Micra to Europe.
